One of the common issues that any traveler needs to address is exchanging money from his home country for the local currency. I think most people that go through this procedure basically accept in advance that they will be ripped off, and just take that loss as part of the cost of their vacation.
While it is true that there is a high chance of losing money during such transactions, a very little bit of effort can save you a drop of money, and might at least make you feel as if you are not a complete freier (for an explanation of that Israeli slang term, see this post from my comedian friend Benji Lovitt).
Basically, I had some American dollars I needed to exchange for shekels earlier today. I used to use one company for all of my money changing needs, but alas they recently fell on hard times (a confusing story that I don’t know all of the details of, but embezzlement or theft may have been involved). Regardless what actually took place, the fact is that they are no longer open, so I needed to find somewhere else.
I knew that there were a plethora of money changers in the center of town here in Jerusalem. For those who are unclear what that means exactly, I am referring to the area around Zion Square, where Ben Yehuda St. and Jaffa / Yaffo Rd. intersect. I had virtually no experience using these guys, so I had no idea if there was a standard exchange rate, or what. But I remembered that the last time I used one of them, he gave me an exchange rate that was extremely low, but that for the small amount of money I was changing at the time (about $100), it didn’t make that much difference.
In this case, I was trading a bit more money. Not enough that it would make a huge impact, but enough that I didn’t want them to have the extra money. I learned a few things about these money traders from a colleague back in my days at learntotrade.co.uk, and I did not want to become the dreaded freier!
Within about 2 blocks of Zion Square, I saw close to 10 different money changers. I did not go into every single one, but I went into about 6 or 7. And let me tell you, the range of exchange rates was really shocking to me. The first 3 change stores I went into were literally within a 10 second walk of each other and they offered the following exchange rates: 3.36 (NIS per US dollar), 3.37 and 3.38. I’m guessing that’s why these stores don’t post their rates visibly outside — because then it would start price wars like at gas stations on opposite corners in the States.
A bit more asking around finally found me two places that were both offering 3.40 shekels per dollar. I went back to the first one that offered me that price and made my exchange. (As a frame of reference, at the close of trading yesterday, the exchange rate was 3.40 and at the close today, after I made my exchange, it was 3.43. That is the middle between the buy and sell rates, so you never really get that number. So the rate I got was fairly good.)
In the end, I only came out with an extra 16 NIS in my pocket, which isn’t that much. But it can buy me a few beers at the supermarket, or a slice of pizza or two. It’s definitely enough that I’d rather have it in my pocket than give it to the money changers.
So what’s my bottom line here? Spend 5 extra minutes walking from store to store to compare. And when I say 5 minutes, I mean it literally. Especially if you are changing a larger sum of money, it can really be worth it.
And by the way, also remember that Israel is in the Middle East, and bargaining is the norm. As I was doing my little price comparison today, 3 of the people who offered me a lower rate asked me how much I had to change when they saw me walking out of the store without making an exchange, implying that they were willing to give me a more favorable rate if I had enough money to be worth it for them. And another actually raised his rate immediately and called after me when he saw me turn around and walk out.
I may try to do a more complete survey soon and post the results here. But for those who are interested in which store had the best rates I received today, check out the picture at the top of the post. The change store is located right next door to the Aldo ice cream store on Jaffa Road, between Zion Sq. and Heleni HaMalka St. (where the Coffee Bean is located).